mary taylor

Good day!

So, this morning, the jobs report was released.....and it was stinker. In fact, it was the worst report in 14 years. To "add salt to the wound", the numbers for August & September were revised downwards by large amounts. In total, nearly 1.2 million jobs have been lost since the beginning of the year. So, while the unemployment figure has jumped to 6.5%, there is another part of this picture that is often ignored......the "under-employment figure". In other words, many people have not lost their jobs.........they just aren't working a 40 hour week, let alone any overtime. Not good at all, but hopefully this means that "the bottom" is near.

The challenge ahead for the Fed is that there isn't too much stimulus left to throw at this problem. Injecting capital into the system is the Fed's primary tool and they have used it quite a bit lately. Typically, the jobs report that we saw today would indicate that the Fed will be cutting rates again in the near future to stimulate the economy. The problem is that the Fed Funds Rate is already at 1%, so there isn't much more room to cut. So unless something changes soon, the stock market will probably continue to slide, which should be a positive for bonds (and interest rates).

Here is some info on Networking -

Increase Your Business Through Networking, Part I

Reaching Out To Your Community

The best way to increase your business is by mastering the art of networking.

Nobody understands this concept better than Dr. Ivan Misner, the founder of

Business Network Int'l. (BNI), the world's largest referral organization. BNI has

over 4,100 chapters with 82,000 members in 26 countries worldwide. In 2005

alone, the organization generated over 3.3 million referrals, translating into $1.5

billion in business.

When it comes to the art of networking as a means to build your business, Dr.

Misner has identified five key strategies. In this first of a two-part series, we'll

examine two of Dr. Misner's recommended tactics:

1 - Diversify Your Networks

It's no secret. You're not going to meet people by being a "cave-dweller" who sits behind a desk all day. In other words,

good business people put themselves out into the community. Misner takes the concept one step further by

recommending that professionals diversify the groups they associate with. He suggests that individuals select at least

three different groups to pursue, since networking with just one group is the business equivalent of putting all of your eggs

in one basket.

Good examples of organizations to network with include local chambers of commerce, Rotary and Lions Clubs, country

clubs, churches, temples and schools. Misner says that even though some of these groups aren't known for business

networking, trusted relationships are built and referrals do take place. As long as you properly honor the event you're

attending, there is no harm in networking.

Dr. Misner goes on to say that a good networker is someone who wants to help people. Referral opportunities arise every

day, but in order to recognize them we must first learn the language of referrals. These opportunities begin with phrases

such as, "I need", "I don't know", or "I can't". In order to be prepared for such events, it's a good idea to carry a business

card file containing your favorite referral contacts and pass a card along in an appropriate situation. Another idea is to

write the referral contact's name on the back of your card and have the recipient email you for the contact information.

Most importantly, teach your referral partners to do the same for you.

2 - Develop Your Contact Spheres

A "contact sphere" is a group of professionals who work in non-competitive businesses which could potentially lead to

symbiotic relationships. As an example, a loan officer's sphere would include real estate agents, financial planners, CPAs,

insurance agents, landscapers, handymen, etc.

Citing his philosophy of "breadth versus depth", Dr. Misner emphasizes that sheer numbers are not nearly as important as

the quality of relationships within one's sphere. He points out that strengthening these bonds is about more than simply

referring business. It's about your ability to help someone however you can, which may be through the offering of advice

or the sharing of ideas. Just remember the "Law of Reciprocity". What you contribute to others will eventually come back

to you.

Look for the remaining three strategies in Part II of this series. Until then, if you'd like to discuss Dr. Misner's

The other day, I overheard a loan officer at a homebuyer fair discussing the benefits of this great "new" FHA product. New ?! It's scary to think that this is a new product for many lenders out there. Anyway, FHA has been around for a long time and we have been doing FHA loans....for a long time. In fact, National City has consistently been one of the top 3 FHA/VA lenders in the nation and I personally have been doing them since the 80's. And yes, I'm that old! J

That being said, I wanted to share some pertinent info regarding some recent FHA changes. Over the past year, FHA has become the product of choice for many lenders. Many lenders are still learning how to use this product, and unfortunately don't always use the product correctly. Because of this, HUD is making some changes to their product to reduce some of their risk. Loan to values on cash out refinances are going to be reduced. Credit is going to tighten further. One thing however, that is important to know is how HUD will look at "retained properties". In other words, if a borrower currently owns a property and wants to make another purchase using FHA, they must be able to qualify for the new house payment along with their existing house payment. In other words, FHA will not allow the borrower to count rental income on their current property unless:

•· The homebuyer is relocating to an area not within reasonable commuting distance

•· The homebuyer has at least 25 equity in their existing home

This is a temporary measure (for now) to try to hold off the increasing numbers of "buy & bail" transactions. In short, a "Buy & Bail" is a transaction where the buyer closes on a new home and walks away from their existing property (allowing it to be foreclosed upon).

In case you didn't already know, starting this week, Clackamas County will only be open for recordings Monday through Thursdays, 7am-6pm. It is expected that Multnomah & Washington will follow suit.

As always, we are here to help in any way possible, so please email or call if you need anything.

Hey there--

Too often these days we get dragged into unprofitable ventures, relationships, and activities. I must tell you that I spend a good amount of time saying "NO!" to various forms of media. I am quite tired of hearing how bad things are, and that the "sky is falling". I find that my days are much more productive when I say "No!" to the gloom and doom of the media and focus on positive, profitable, high payoff activities. Being able to focus on high payoff activities is my key to having a successful day, week, and year. Please keep in mind that not all of my "high payoff activities" are income related. Many of them for me are related to time spent with business partners, teammates, my family, and assorted non profit agencies that we work with. So, take a moment to read the item below and hopefully it brings some value to your week.

Toda is Fed day! The Fed began their meetings and at 2:15 EST, they will release their Policy Statement and Interest Rate Decision. While a cut of .50% is expected and is already "priced in" by the market, a larger cut is possible. More of a cut could move the markets..........however, which direction they'll move is uncertain. With consumer confidence being so low (today's number was the lowest on record) and the stock market in rally mode (the 889 point gain today was the second best ever), it's hard to tell where the market is headed. Typically, too much of a cut could signal trouble (that the Fed sees more bad news ahead), so we'll see what happens tomorrow. Remember, Fed Funds Rates and mortgage rates typically move in opposite directions, so this cut is not expected to improve first mortgage rates, but it will improve rates on most home equity lines of credit.

Have a cheerful day!

Mary Taylor

Knowing when to say NO

Position Yourself to Work with High-End Clientele

In an effort to increase your hourly rate of pay, you must make the commitment to

focus on high payoff activities. If you find you are working with too many

high-maintenance customers that generate little profit, then it's time to weed these

types of people out of your book of business.

This is the approach that superstar Realtor®* Kathi McLean of REMAX® Olson &

Associates, took when she realized she was spinning her wheels with too many

customers who drained her of her time and energy, with little financial gain. Kathi

concluded that her business could only improve by turning down people that fit this

profile.

Kathi and her husband Bob McLean started to take a more selective approach.

They began refusing to work with people who were disrespectful or had a negative

attitude. By choosing to work with quality clientele, they saw a distinct difference in

both their income and time management capability in just six months.

The McLeans compare their scenario to the business models of restaurants

recognized for fine dining. For example, if you fail to make reservations at the

exclusive Château d' Fancy in Beverly Hills, they certainly aren't going to set up a card table in the alley for you. As much

as they want your business, they still insist that you comply with their business model: Make the reservation, and savor

the dining experience.

On the other end of the spectrum there are fast food joints begging for your business! You can eat inside, outside, or even

in your car. Your children can play on their playgrounds, and if you buy certain products you'll get a prize, a toy, or even a

coupon for more food! They'll do just about anything to get you in the door. Which type of restaurant do you have more

respect for? More importantly, where would you rather work with if given a choice?

Take the time to sit down and analyze where the majority of your time is spent. Which customers take the most time with

the least amount of payoff? Conversely, who are the easiest people to work with, yet generate the greatest financial

return? From there, define your business model and commit to working with people who make your production numbers

soar!

Call me when you have a client who needs special attention in obtaining their mortgage loan.

Association of REALTORS® and subscribes to its strict Code of Ethics.

All loans subject to credit approval and property appraisal. Programs, rates, and terms subject to change without notice. For ARM loans, rate may increase after

settlement. Prequalification is not a commitment to lend, a condition of loan approval, or an application for credit. Pre-approvals will result in a loan decision

subject to conditions. Consult a tax advisor regarding the deductibility of interest.-- a Division of National City Bank

For Immediate Release

Media Contact:

Mary Taylor

503.261.7334

local public servants achieve Homeownership with

National City Mortgage's Community Heroes INITIATIVE

PORTLAND-[October 22, 2008] - Recruiting and retaining public servants - such as education, healthcare and law enforcement professionals - is an important goal for any community, and National City Mortgage is doing something to help. National City Mortgage has developed a Community Heroes initiative to make homeownership a reality for the people who make our towns a better place to live.

"The program makes it easier for public servants to become first-time homeowners by offering them special mortgage options that save them money and sometimes get them into a home sooner than they might have otherwise," said Mary Taylor, Sales Manager National City Mortgage.

National City offers a variety of loan options to meet the needs of our Community Heroes. Public servants may qualify for an expanded debt ratio, up to 45 percent, and in many cases will need little or no money out-of-pocket at closing.

The Community Heroes initiative is specifically designed for teachers and education administrators, firefighters, healthcare workers, law enforcement professionals, and members of military including veterans and reservists.

To learn more, visit your local National City Mortgage office in Portland location or go to www.ncmc.com/marytaylor.

About National City Mortgage

National City Mortgage originates a comprehensive suite of mortgage products in all 50 states through more than 200 retail mortgage offices, our preferred lending business and National City's 1,400 retail bank branches in nine states. These loans are ultimately sold to secondary mortgage market aggregators with the servicing of loans retained in the National City family. National City Mortgage, a division of National City Bank, is recognized as one of the top retail residential originators and servicers nationally. For more information, visit www.nationalcitymortgage.com.

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The Chinese have a proverb: "May you live in interesting times." And we are living through interesting times indeed.

Whatever the political posturing regarding the rescue plan, a plan needed to be passed. Credit markets are frozen and banks

are going bust every day. This is not totally because of "toxic" mortgages. This has a lot to do with FASB 157, also known as

"mark to market".

Each day, lenders must mark their assets to the marketplace. It's like you having to appraise your home everyday and, if your

neighbor was under duress because she got very ill, divorced, lost her job and was forced to sell her home quickly, she may

have sold it super cheap. Now, does that mean your house is worth that super cheap price, too? Clearly not. Why? Because

you are not under duress. You have the time to sell your home and get a more normal price, which more accurately reflects

true market conditions. But "mark to market" does not allow for this, which creates a vicious cycle.

Why is this so bad? Because, as lenders mark down their assets the amount that they have previously loaned becomes much

riskier in relation to their assets. For example, say a bank has $1 million in assets and say they have $15 million in loans

outstanding. Their ratio is an acceptable 15 to 1. But should they take a paper write down of $500 thousand due to "mark to

market" requirements, their ratio suddenly changes to 30 to 1. This is because their assets are now only $500 thousand after

taking the paper loss, while their loans outstanding are still $15 million. And at 30 to 1 this bank is viewed as a risky

investment. So the stock price starts to get hit, it becomes harder to borrow, and most importantly harder to make money. The

bank is then forced to sell some of its loans to reduce its ratio...at cheap prices. And this makes the vicious cycle continue.

And a quick look at the holdings of these loans show that 95% are problem free. Additionally, the Credit Default Swaps (CDS)

that are used with the pools of mortgages are relatively safe. But this requires a bit of understanding. You see, when a pool of

mortgage loans is put together it isn't just A paper or B paper etc. it's everything. It's got some A paper, B paper, C

paper...and even what looks like toilet paper. An "A" investor buys the whole pool but because they are an "A" investor their

safety is greater because they can avoid the first 20% (an example) of defaults. So they own the whole pool but are sheltered

from the first batch of defaults, and for this they get the lowest rate of return. As you can figure from here the more risk

investors want to take, the higher the return. So the investments are relatively safe, but the accounting rules currently place

undue pressure on the banking institutions.

Now add to all this, the opportunistic "shorting" done on the financial stocks, much of it illegal because those shorts did not

legitimately borrow shares (called naked shorting), and you exacerbate this whole problem. Thank goodness for the recent

temporary ban on shorting in the financial sector. As for the plan, the government is the only one who can step in to do this.

And they have to do this. And they will do this. The nauseating political posturing from both sides is just part of the process.

This is not easy to understand for the general public. In fact most politicians don't get this either. That's why it is a difficult yet

critical bill for them to vote on.

Once this is done, it will take some time but the markets will stabilize. As for the real estate and mortgage industries, it will

take a bit of time but we will make it through this. Rates will remain attractive and the influx of credit availability will help the

housing market gradually improve. This ultimately will be the medicine needed to improve the situation overall.

All loans subject to credit approval and property appraisal. Programs, rates, and terms subject to change without notice. For ARM loans, rate may increase after settlement. Prequalification is not a commitment to lend, a condition of loan approval, or an application for credit. Pre-approvals will result in a loan decision subject to conditions. Consult a tax advisor regarding the deductibility of interest.-- a Division of National City Bank